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In 2001, the Belgian company Tractebel bought the Houay Dam in south Laos. For the Heuny and Jrou indigenous people the dam has been a disaster. Tractebel has so far ignored their problems.
By Chris Lang. Published in WRM Bulletin 80, March 2004.

For hundreds of years, Heuny and Jrou indigenous people living in Nong Phanouane and Houay Chote villages have practised rotational swidden farming in their forests on the Boloven Plateau in the south of Laos.

Now, government officials have told them that they have to stop swidden farming and will soon be forced to move. The reason? They have the misfortune to live in a watershed which the government declares must be protected because of a proposed hydropower dam.

South Korean company Dong Ah started construction of the $1 billion Xe Pian Xe Nam Noi dam in 1996 but pulled out after the 1997 Asian financial crisis. Recently, the Vietnam Laos Investment and Development Company announced plans to build six dams in Laos, including the Xe Pian Xe Nam Noi dam (see WRM Bulletin 74).

The Houay Ho dam, also on the Boloven Plateau, was completed in 1998. A consortium of Daewoo (South Korea), Loxley (Thailand) and Electricité du Lao started construction of the dam in 1994 after Daewoo signed a 25 year build operate transfer contract with the Lao government. The electricity produced by the 150 MW dam is exported to Thailand.

The consortium hired Electrowatt Engineering, a Swiss consulting firm, to design the dam, produce an environmental impact assessment (EIA) and supervise construction of the dam. Electrowatt’s EIA, which was completed two years after dam construction started, failed to deal with the impact of logging or with the impact of the project on the indigenous peoples in the area.

An unusually generous 50 metre-wide corridor for the transmission lines gave a bonus to the Thai logging companies responsible for clearing the forest in the reservoir area. About 70 kilometres of wide new roadways were built through previously “inaccessible and undamaged primary forest”, according to Doug Cross, a consultant on an Asian Development Bank-funded project who visited the area in 1997.

Around 4,000 people, mainly Heuny and Jrou, were forcibly evicted to make way for the Houay Ho dam.

The researchers found that many families in the resettlement areas have too little farm land. Much of the land is poor quality and unsuitable for agriculture. As a result villagers face serious food shortages. Although wells were drilled, many are now dry and villagers lack access to clean water. Schools exist, but without enough classrooms or teaching materials. Older villagers told researchers that they miss the fertile lands and the large fruit trees growing near their old villages. Traditions are dying out, as people are forced to travel to find work. Downstream of the Houay Ho powerhouse, villagers face flood damage to their paddy fields and drowned livestock, especially in the rainy season.

A Heuny man told researchers, “My relatives and I don’t want to live in the resettlement village but we were forced to and we could not protest. We miss our native lands where we used to live for hundreds of years, our crops, vegetables and our happy lives.”

In September 2001, the Houay Ho Power Company, a joint venture of subsidiaries of Tractebel Electricity and Gas International, bought Daewoo and Loxley’s shares in the Houay Ho dam for $140 million. The Lao government retained its 20 per cent share in the project. Financing came from a syndicate of Thai banks and the Belgian export credit agency, Office National du Ducroire, provided political risk insurance for Tractebel’s involvement.

Katje Damman, responsible for External Communications at Tractebel, is unwilling to describe the details of the political risk insurance provided by Ducroire. “If you want to have all the details of what the political risk insurance exactly covers, you should check with the agency. I can’t tell you. It’s what a national political risk insurance normally covers, I think. It’s a normal political risk insurance,” she said.

Ducroire declined to answer questions about the Houay Ho dam.

Damman denied that the villagers evicted by the Houay Ho developers are facing problems. “The resettlement programme has been finalised. There are no claims and the Houay Ho Power Company keeps in contact with the local authorities to see if there are any problems.”

The authors of the “Forgotten People” report point out that the local authorities “have not taken any responsibility for the livelihoods of the villagers who have been moved out of their former villages.”

Having seen what happened to their friends and relatives who have already been forced to move, the Jrou from Nong Phanouane village have worked out a plan. If they are forced to move to the resettlement areas, they will not take down their houses. If, after four or five months, government officials fail to provide them with everything promised, the Jrou will return to their homes in Nong Phanouane. The authors of the “Forgotten People” report add, “If they are killed for returning, they will be ready to be killed in their own homes.”